Eckman v. Encompass Home & Auto Ins. Co.

551 F.Supp.3d 547

Christian ECKMAN, Plaintiff,

v.ENCOMPASS HOME AND AUTO INSURANCE CO., Defendant.

CIVIL ACTION NO. 19-4038-KSM

United States District Court, E.D. Pennsylvania.

Filed July 30, 2021

Ryan F. Curran, Francis J. Curran, Jr., The Curran Firm PC, Media, PA, for Plaintiff.

Andrew J. Kramer, Kane, Pugh, Knoell & Driscoll, Amy M. Kirkpatrick, Kane Pugh Knoell Troy & Kramer LLP, Norristown, PA, for Defendant.

MEMORANDUM

MARSTON, District Judge Plaintiff Christian Eckman, individually and as executor of his deceased wife's estate, asserts a claim for a declaratory judgment against his insurer, Defendant Encompass Home and Auto Insurance Company ("Encompass"). (Doc. No. 1-1.) Eckman's claim stems from injuries sustained in a February 16, 2019 automobile accident that tragically resulted in the death of his wife, Deana Marie Eckman. (Id. at ¶¶ 12–18.) Eckman seeks a declaratory judgment that he is entitled to receive underinsured motorists coverage ("UIM")¹ benefits in an amount equal to the bodily injury coverage benefits he received under his policy. (Id. at ¶ 70.)

In Pennsylvania, basic UIM coverage is for an amount equal to the policy's bodily injury limits. 75 Pa. Cons. Stat. § 1731. However, pursuant to section 1734 of Pennsylvania's Motor Vehicle Financial Responsibility Law ("MVFRL"), an insured may request "in writing" for a lower amount of UIM coverage.² Id. § 1734. To effectuate such a request, insurance companies use the Pennsylvania Auto Supplements (the "PA Supplements"),³ which include the Section 1791 Important Notice and UM and UIM coverage selection/rejection forms (sometimes referred to as "sign-down forms" in the Pennsylvania insurance industry (see Doc. No. 1-1 at p. 280)).

During discovery in this case, Encompass produced copies of the Section 1791 Important Notice, and the UM and UIM sign-down forms, all of which Eckman had signed and executed in June 2013 when he first applied for his insurance policy. (See Doc. Nos. 18-8, 18-9, & 18-13.) Eckman filed a motion to preclude these documents from evidence (Doc. No. 17), which this Court denied by a separate Memorandum issued today.

Eckman and Encompass have filed cross-motions for summary judgment. (Doc. Nos. 19, 20.) The Court must now determine whether Eckman is entitled to UIM benefits in an amount equal to the policy's bodily injury limits, given that he signed his insurance application and UIM sign-down form, both requesting a lower amount for UIM coverage. For the reasons that follow, the Court grants Encompass's motion for summary judgment and denies Eckman's cross-motion.

I. Procedural History

On August 8, 2019, Eckman filed this declaratory action in state court (Doc. No. 1-1), and Encompass removed the matter to this Court on August 30, 2019 (Doc. No. 1).⁴ On November 22, 2019, during discovery, Encompass produced copies of Eckman's executed Section 1791 Important Notice and UM sign-down form. (Doc. Nos. 18-8 & 18-9.) Then, on December 4, 2019, during the deposition of Encompass's corporate designee, William van Duys, van Duys located and produced the executed copy of Eckman's UIM sign-down form. (Doc. No. 18-13; van Duys Dep. Tr. at 42:22–43:20.) Eckman filed a motion to preclude this evidence (Doc. No. 17), which the Court denied.

On January 10, 2020, the parties filed cross-motions for summary judgment; and two weeks later they filed cross-responses. (Doc. Nos. 19–22.) Eckman argues that he is entitled to summary judgment because he did not request in writing UIM coverage for an amount less than the limits of liability for bodily injury, as required by the MVFRL. (Doc. No. 20.) In contrast, Encompass asserts that it is entitled to summary judgment because Eckman properly requested in writing the lower UIM coverage. (Doc. No. 19.)

The Court ordered the parties to file supplemental briefing regarding the Third Circuit's April 2021 ruling in Gibson v. State Farm Mutual Automobile Insurance Co. , 994 F.3d 182 (3d Cir. 2021). (Doc. No. 33.) In his supplemental brief, Eckman argues that Gibson is factually distinguishable from this case and supports his summary judgment motion. (Doc. No. 35.) Encompass disagrees and argues that Gibson mandates summary judgment in its favor. (Doc. No. 34.)

The Court held oral argument on June 22, 2021. Eckman testified on his own behalf for his motion for summary judgment. During oral argument, Eckman conceded that if the Court denies his motion to preclude and holds that the PA Supplements are admissible, then Encompass is entitled to summary judgment. (Hr'g Tr. at 38:7–17.)

II. Factual Background

A. The Accident

On the evening of February 16, 2019, an inebriated motorist driving 78 miles-per-hour and in the wrong lane struck head-on the vehicle Eckman and his wife, Deana Marie Eckman, were driving. (Doc. No. 1-1 at ¶ 12.) Tragically, Mrs. Eckman was fatally injured and Eckman was seriously injured. (Id. at ¶¶ 16–18.)

At the time of the accident, the Eckmans had an auto insurance policy with Encompass, which they originally obtained in June 2013. (Id. ) There is no dispute that Eckman is eligible to receive UIM benefits. The only issue is the limit of coverage.

B. The Insurance Policy

In June 2013, the Eckmans applied for an Encompass automobile insurance policy through their insurance agent, Donald Blizzard, who is also Eckman's brother-in-law. (See Doc. No. 18-5 at p. 5; Eckman Dep. Tr. at 18:14–20:19.) Blizzard or someone in his office filled out the Encompass application for Eckman, and Eckman then went to the office to sign the documents. (Eckman Dep. Tr. at 22:1–23.) Once Eckman arrived at Blizzard's office, all he did was sign the paperwork. (Id. ) He did not review the documents before signing them, and now eight years later, he does not recall any of the specific documents he signed. (Id. at 22:24–23:2; Hr'g Tr. at 15:4–15.)

The insurance policy provides bodily injury liability coverage of $250,000 per person and $500,000 per accident, as well as UM and UIM coverage of $100,000 per person and $300,000 per accident. (Doc. No. 22-12 at p. 2.) The insurance policy also provides for "stacked" coverage.⁵ (Id. )

Eckman's application includes the following disclaimers just above Eckman's signature:

I have read the above application and any attachments. I declare that the information provided in them is true, complete and correct to the best of my knowledge and belief.

...

I understand that the coverage selection and limit choices indicated here or in any state supplement will apply to all future policy renewals, continuations and changes unless I notify you otherwise in writing.

(Id. at p. 5.)

Eckman's UIM sign-down form contains the following information:

Underinsured Motorists coverage is optional coverage. However, we are required to include it in your policy unless you take steps to reject it.

Underinsured motorists protection is insurance coverage you carry in your own policy that protects only you and your family, and any other person while occupying an insured auto, if you are injured by a negligent driver who does not have enough bodily injury liability insurance to cover your claims and whose policy limits are less than your underinsured motorists coverage limits.

...

You have the option of purchasing underinsured motorists coverage up to the limits of your bodily injury coverage. You also have the option of purchasing lower limits.

The underinsured motorists coverage limits I select are: $100000/300000

(Please also show these limits on the application.)

(Id. at p. 18.) Eckman's signature and a handwritten date (June 13, 2013) appear immediately below this final instruction, both of which match the date and handwriting on his insurance application. (Compare id., with id. at p. 5.)

Encompass issued the automobile insurance policy in June of 2013; the policy was subsequently renewed and amended to add and remove vehicles. (See Doc. No. 1-1 at ¶ 42; Doc. No. 19 at p. 8.) No removals or amendments changed the liability amounts requested on Eckman's original application. (Doc. No. 1-1 at ¶ 42; Doc. No. 19 at p. 8.) At the time of the fatal crash, the policy covered Eckman's four vehicles. (See Doc. No. 19-47 at pp. 6–9.)

III. Legal Standard

Summary judgment is appropriate when the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A factual dispute is "genuine" within the meaning of Rule 56 if "a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Disputes over facts are material if the facts at issue "might affect the outcome of the suit under the governing law." Id.

When confronted with cross-motions for summary judgment, the "court must rule on each party's motion on an individual and separate basis, determining, for each side, whether a judgment may be entered in accordance with the Rule 56 standard." Freeth v. Zurich Am. Ins. Co. , 152 F. Supp. 3d 420, 425 (E.D. Pa. 2015) (quoting Schlegel v. Life Ins. Co. of N. Am. , 269 F. Supp. 2d 612, 615 n.1 (E.D. Pa. 2003) ). Here, the parties dispute whether Eckman requested in writing lower coverage for UIM benefits pursuant to the requirements of the MVFRL, which presents a pure question of law for the Court.

IV. Discussion

Eckman concedes that if the Court finds Eckman's PA Supplements admissible, then Encompass is entitled to summary judgment. (Hr'g Tr. at 38:7–17.) Thus, given the Court's ruling that Eckman's PA Supplements are admissible, the Court grants Encompass's motion for summary judgment and denies Eckman's motion for summary judgment. In the alternative, the Court finds that even if it were to preclude Eckman's PA Supplements, Encompass would still be entitled to summary judgment.

"Underinsured motor vehicle coverage (‘UIM’) is designed to help...